Five Profitable Double Net/Nets

by: Jon Heller, CFA

Today we again lighten our constraints, and feature the top five profitable companies trading at less than two times net current asset value, in order of market cap.

No, we are not getting soft in our old age. Companies trading at less than twice current assets less all liabilities (and preferred stock) typically have very strong balance sheets. Throw in profitability, which most net/nets can't claim, and you've got a potentially formidable combination.

While Ben Graham preferred candidates trading at less than 2/3 NCAV, and we've typically focused on those trading at less than NCAV, these companies might be a couple cuts above the typical cigar butt.

Top Five Profitable Double Net/Nets by Market Cap:

Ingram Micro (NYSE:IM)
Mkt Cap: $3.7 billion
NCAV: $2 billion
Mkt Cap/NCAV: 1.85
Price: $21.78
P/E: 15.6

Sycamore Networks (NASDAQ:SCMR)
Mkt Cap: $1.18 billion
NCAV: $892 million
Mkt Cap/NCAV: 1.32
Price: $4.21
P/E: 61

Mkt Cap: $530 million
NCAV: $357 million
Mkt Cap/NCAV: 1.49
Price: $14.76
P/E: 67

Adaptec (OTC:ADPT-OLD)
Mkt Cap: $452 million
NCAV: $388 million
Mkt Cap/NCAV: 1.17
Price: $3.80
P/E: 15.3

Farmer Brothers (NASDAQ:FARM)
Mkt Cap: $340 million
NCAV: $200 million
Mkt Cap/NCAV: 1.17
Price: $21.79
P/E: 65

Farmer Brothers is the only company we've previously covered, and frankly, the others on this list - all tech related - aren't exactly our cup of tea. We are not making a judgment on them, we just typically shy away from businesses we don't understand.

Disclosure: The author does not have a position in any of the stocks mentioned.